Unions have pledged to fight the closure of a Birmingham car components factory and the loss of 235 jobs.

Arvin Meritor, based in Mitchigan, yesterday said it planned to close its factory in Fordhouse Lane, Stirchley, and move production of door latches out of the country.

The company, which has 14 sites in Britain blamed the decision on falling demand and rising material costs.

"This is an undesirable and difficult position for our business and our employees," said Bob Marty, vice president and general manager of Arvin Meritor's LVS Door Systems division.

The company had met union representatives to " address the severity of the situation, noting that declining customer demand and increasing material and logistic costs have resulted in the business's declining performance".

Mr Marty added: "The company must evaluate all alternatives, including the reduction of employees, as a means to rationalise its business and rightsize its capacity."

Car component production has been carried on on the Stirchley site since 1927 and 180 jobs were axed six years ago when it lost its sunroof manufacturing facility.

Tom Keogh, regional officer of the manufacturing union Amicus, said: "I have no intention of sitting back and letting this happen.

"This is the unacceptable face of Europe where it is cheap and cheerful to sack people in the UK and give their work to other countries."

Meanwhile, MG Rover refused to comment on a report claiming suppliers were tightening the credit terms they offer the carmaker.

Supply chain companies were either shortening their payment periods or enforcing payment more strictly in order to reduce their exposure in the event of the collapse of a rescue of MG Rover by Shanghai Automotive Industry Corporation, China's biggest car company.